Govt decides against removing RBI nominees from PSB boards, cites NPA issue

Urjit Patel had said in June that no central bank nominee should be on the board of PSBs in a bid to avoid "conflict of interest"

The government has decided to turn down the Reserve Bank of India’s (RBI’s) demand for removing the regulator’s nominees from the boards of public sector banks (PSBs). 

The government felt the presence of the RBI’s nominees on boards should continue at a time when the banks were grappling with bad loans and dealing with various cases of frauds, said a senior official. 

“A communication was sent by the finance ministry to the RBI last month conveying the government’s decision, which had the approval of Finance Minister Piyush Goyal,” said the government official. 

RBI Governor Urjit Patel had said in June that